Banking & Financial Services Market Insights Q3 2017

Despite the economic uncertainty around the world and some areas of hiring being flat in Q2 2017, certain areas within the Banking & Financial Services market in Singapore have been optimistic and hiring activity has been relatively strong.

Although many international banks have offshored large parts of their back office functions to lower cost locations, the busiest areas were within the middle and back offices. As expected, a lot of hiring has been within the Regulatory and Governance space. We have also seen an increase in hiring from mid-sized international and local banks.

Lack of headcount and rise of temporary staffing

In Q2 2017, temporary and contract hiring was extremely active among banks, including top-tier international banks. This is due to the lack of permanent headcount approvals, resulting from cost-cutting measures amidst an uncertain economic outlook.

We have seen banks opening up a wide range of positions, either for project work or for backfilling permanent employees pulled from their daily duties onto these projects, which are mainly in the areas of KYC/Client Due Diligence, Compliance/AML and Risk. Tighter regulations on financial institutions have resulted in the high demand for experienced KYC/AML professionals.

The other area of high talent demand was for finance roles to cater for the implementation of IFRS 9 and the introduction of Basel 4 in 2018. 

Desire for change amidst lack of permanent roles

Competition for jobs among professionals within Banking & Financial Services has been high due to lack of permanent headcount. 

We saw an increasing number of permanent employees who were open to considering contract roles, motivated by the decreasing variable bonuses and a perceived lack of career progression as their functions were offshored. They also desired a change of working environment, wanted to pick up new skills and sought potentially higher base salaries offered in contract roles. 

Job seekers who were more flexible on their requirements and availability have been having an advantage in securing a job with their ideal employer. There have been contracting roles which offered the possibility of further extension, or as the opportunity arises, the conversion to permanent.

Regulatory Reporting and FP&A professionals in demand

Key skillsets in demand within finance in Q2 2017 were Regulatory Reporting, largely due to the new IAS9 implementation. Professionals skilled in Financial Planning & Analysis/Business Finance were also in demand.

Growing need for Trade Finance, Hedge Funds Ops and Fund Ops talent

In Q2 2017, within operations, we were seeing Trade Finance roles in high demand as business volume picked up. There was also a similar level of demand within Hedge Fund Operations as more bankers were moved into alternative investment businesses. Private Equity growth has also increased the demand for Fund Accounting and Operations professionals.

Regulations continued to boost Compliance talent demand

For Compliance, in Q2 2017 we have seen a significant hiring activity both for newly created and replacement roles. 

Singapore has always been committed to implementing a robust regulatory and supervisory regime related to AML, CFT and Financial Sanctions. This demanded more compliance gatekeepers to help avoid heavy fines, prevent bad market reputation and counter money laundering. 

Good Compliance talent remained scarce

Compliance recruitment has been highly competitive. The lack of high-calibre talent with the relevant exposure and immigration rules remained the biggest challenge for most banks and financial firms. Job seekers with skillsets in Compliance Regulatory, Compliance Advisory, KYC (Know Your Customer) or COB (Client on Boarding) were in high demand.

IFRS 9 sent ripples for Risk hiring

With IFRS 9 being implemented as a market standard, Market Risk and Credit Risk professionals skilled in IFRS 9 impairment modelling were in demand. Banks and NBFIs required individuals with credit risk backgrounds to also have an understanding of expected credit losses (ECL).

Credit risk teams need the hands-on manpower they can have as they move towards project completion and effect of IFRS 9 in 2018. Since this is a relatively new standard, banks and NBFIs have been open to, despite the steep learning curve, professionals experienced in corporate and wholesale credit models. Professionals with IFRS 9 certification typically had an edge over other job seekers.

Shortage of senior Internal Audit professionals

Internal Audit hiring, though not as optimistic as the past two years during which banks in Singapore were growing their audit functions, has continued to be active in Q2 2017.

While banks often hired straight from the Big 4 for more junior positions, it was not the same for mid- to senior-level positions as there was a shortage of these professionals. Competition for such talent, compounded by requirements for hires to be Singapore citizens, has been fierce across both Business and Technology Audit areas. 

As audit functions expanded and teams became more specialised in their focus, we were seeing an increasing number of potential hires as Subject Matter Experts coming from the business or from 2nd line moving into the 3rd line of defence. This did bolster candidate numbers to an extent but best people often held multiple offers.

Competition for M&A and PE talent in the front office

Mergers & Acquisitions (M&A) and Private Equity (PE) activities have been optimistic, which created a high demand for top talent from Big 4 firms, management consultancies, banks and PE firms. These talent are hard-to-find from both global and local perspectives.

Offshore Banking Relationship Managers were also in demand for offshore markets besides Indonesia, especially for Malaysia, South Asia, and Greater China. Indonesia, despite being one of the biggest offshore markets, has been cooling down due to the recent Indonesian Tax Amnesty. Indonesian clients were investing less in Singapore, resulting in tough times for Offshore Relationship Managers of these clients. Hence, more emphasis has been on business development with clients in the other offshore markets.

Commodities: Hiring in the middle and back offices

In the past quarter, we saw commodities trading firms going through restructuring and discontinuing some trading products. The majority of the roles we have seen in Q2 this year have been in the middle and back offices.  

Due to low commodity prices and thin margins, most trading firms have looked to increase their trading volume and diversify their client portfolios in order to make up for their decreasing sales revenue. We saw firms increasing capacity and improving the efficiency of their Operations functions, as well as hiring for Risk-related middle office roles.

Looking ahead into Q3 2017

We expect similar hiring trends to continue in Q3 of this year. Hiring in this sector will remain optimistic in certain areas, especially in Regulatory and Corporate Governance. In times of economic uncertainty, contracting will continue to grow as a viable option for both the employer and job seeker in the Banking & Financial Services sector. 

Banking & Financial Services
Salary Report for Q3 2017*

*Notes about salary table:

1. Titles and levels vary from organisation to organisation.

2. The salary ranges given are only approximate guides. For tailored salary advice, please contact us directly.

3. 12-month base salaries are assumed.

4. All other benefits and bonuses are in addition to these figures.

5. Bonus ranges can vary significantly from company to company and will be influenced by market conditions, business and individual performances. Bonus ranges from 1 month at the low end to 100%+ at the upper.

6. Holiday entitlements range from 12–25 days with senior executives not usually receiving less than 18 days. Less than 15 is very rare and 20 days is becoming the norm.

7. Healthcare policies are standard.

8. Pension plans vary with some companies offering greater than the standard contribution. Top up schemes can increase employer contribution levels as much as 15–20% of the base salary for senior executives.